Data and customer focus are perhaps the key drivers of the emerging model of the connected life insurer.
It seems to me that the connected life insurer is, in a sense, the result of an ongoing dynamic between increasing amounts of data and greater customer focus. The data, as I’ve said, comes from the Internet of Things, and it allows the insurer to use sophisticated analytics to build up an ever more granular picture of the customer, and thus to increase the number of customer interactions and their quality. Done properly, this will help create a relationship that is long-lasting.
This type of approach, as I’ve also already noted, requires insurers to start looking beyond the boundaries of insurance to service their customers better. Equally true is the new motto of the connected world: He (or she) who has the data, wins the game.
In last week’s blog, I explained how this might occur using health/ medical insurance as a starting point. This is by no means the only entry point to this way of thinking. For example, if one considers a classic life insurer has an excellent of its client’s age and life circumstances, and thus is perfectly positioned to position itself as a lifestyle partner usually by honing in certain major life events, such as marriage, the birth of children, retirement—to name just three.
Let’s take the birth of a child, for example. In the traditional model, the customer would approach the carrier maybe to add medical cover for the new arrival, and that would be that. The new approach would be track the child’s career, offering value-added services to the parents as appropriate. But perhaps the true benefit would come when the young adult leaves school and is embarking on tertiary education: by offering financial and other services related to career training and then launching a career, the insurer is able to gain a whole new generation of customers.
Another example could be a program that uses a range of benefits and loyalty mechanisms to help customers manage their risk and, incidentally, to provide the carrier with abundant information to continue the process. The aim here is to become a true lifestyle partner. One of the leaders in the field is South Africa’s Discovery, which is now moving into the European market in partnership with one of the local market incumbents.
As these examples show, context can be used to prompt the insurer to play a growing number of roles—for example, giving advice or facilitating access to related services.
I could go on with still more examples, but I’m sure you get the picture. The key point is that life insurers learn to start with the customer, and then work inwards to meet his or her needs. That’s the way of the future.
If you’d like to explore the ramifications of digital transformation and take your thinking further, you might like to download some of the following material. My best wishes for a happy Christmas and holiday season, and I look forward to reconnecting with you in the new year.